Josh Weinstein invests in what he knows best, and lately, that has been China. In 2004, he flew some 6,500 miles from San Diego to Shanghai, China, to launch Duo Guo, a retailer of ringtones and other mobile content. His daily exposure to China's largest city now has him hungry for the next investment. So far, Weinstein has put money in Gome Electrical Appliances, a retailer similar to Best Buy. He is also considering investing in English-language training schools like New Oriental Education. "If 1.3 billion people are striving to learn English, it's attractive, to say the least," he says. For broader exposure, he's thinking about a Chinese market index. The Shanghai Composite Index, for example, hit a record this year after doubling in 2006. "Since my ear is to the ground, I can make calculated bets," says Weinstein.

Though living in China has its advantages for Weinstein, other investors hungry for a piece of the global pie need not move abroad to make sound investment picks. Here's a far-and-away strategy.

Learn the Lay of the Land
Foreign investments are only as reliable as the countries in which they trade. "A lot of political and regulatory decisions take place that [individuals] just don't know of that can be very material to companies operating overseas," says Jeffrey Kleintop, chief market strategist at LPL Financial Services. Read local daily papers and download reports from the International Monetary Fund and the World Bank for insight. Find out what kind of recourse there is for business owners. What are the bankruptcy laws like? What are the political risks?

Also, how much money is being spent on education in that country? "That ultimately tells you about the long-term health of the economy," says Joel Kurtzman, senior fellow at think tank The Milken Institute. And determine whether the country's currency trades openly in the foreign market. "If not, that typically means the government is heavily involved in the [marketplace], which traditionally hasn't proved too healthy," he says.

Additionally, beware of excess outflow of money as a sign that "the locals in a particular country don't trust their own economy," says Kurtzman, whose new book, Global Edge, examines the institutional risks in some 50 countries.

Work in ReverseRather than picking a country first, some experts recommend pinpointing hot sectors and then tracing them to specific countries. Take biofuels. "In the long term, we're still looking at this long wave of raw materials prices rising and [we're] looking for alternative sources," says Karina Mayer, managing director at International Strategy and Investment. Brazil, meanwhile, is the world's greatest maker of ethanol and Brasil Ecodiesel is the country's largest biodiesel producer. Alexander Kazan, Latin American strategist at Bear Stearns, adds that with rising demand for biofuels comes increased production of seed crops. As a result, he recommends Banco do Brasil for its lending exposure to the local agriculture sector.

A less intense play may be buying shares of U.S.-based companies with growing international presences, like Caterpillar, Deere, General Electric and Yum Brands. There are also exchange-traded funds that track the Morgan Stanley Capital International (MSCI) EAFE Index, an international benchmark of more than 1,140 stocks in Asia, Australia, Europe and the Far East. It has outperformed the S&P 500 Index between 2002 and 2007.

Weinstein, however, prefers complete investment exposure to China. "The economic impact the Chinese will have on our world is still underestimated," he says. "The risk is high, [but] the reward will be even higher."